Insperity Inc (NSP)

Cash ratio

Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Cash and cash equivalents US$ in thousands 1,039,000 693,000 733,000 575,812 554,846
Short-term investments US$ in thousands 133,000 135,000 90,031 120,742 82,521
Total current liabilities US$ in thousands 1,930,000 1,436,000 1,353,370 1,128,570 904,924
Cash ratio 0.61 0.58 0.61 0.62 0.70

December 31, 2024 calculation

Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($1,039,000K + $133,000K) ÷ $1,930,000K
= 0.61

The cash ratio of Insperity Inc has shown a gradual decline over the past five years, starting at 0.70 on December 31, 2020, and decreasing to 0.61 by the end of December 31, 2024. This trend suggests that the company may be becoming less capable of covering its short-term liabilities solely with its cash and cash equivalents.

While the cash ratio of 0.61 as of December 31, 2024, indicates that Insperity Inc still has $0.61 in cash and cash equivalents for every $1 of current liabilities, it is important to note that a lower cash ratio could signify potential liquidity challenges or inefficiencies in managing its cash resources.

It is recommended that Insperity Inc carefully monitors its liquidity position and explores strategies to improve its cash reserves to ensure it can meet its short-term obligations comfortably. Additionally, the company may consider implementing more efficient cash management practices to enhance its overall financial stability and flexibility.